The Effects of a Government Shutdown on Biopharma
Christopher Peterson, co-head of the firm’s Capital Markets practice, and Debbie Feinstein, head of the firm’s Global Antitrust group, were recently quoted in a BioCentury article that discusses how a U.S. federal government shutdown would affect the biopharma sector. Although the shutdown was averted at the last minute following the passing of a stopgap spending bill, another shutdown could still take effect in mid-November once current funding is set to expire.
Peterson told BioCentury that under a shutdown, IPO filings would be disrupted because any review and comment process for S-1s—registration statements reviewed by the SEC under IPO filing procedures—would stop. “There’s a legal risk if you don’t go through a full SEC review process,” Peterson said, adding that it is unlikely any biotechs would take such risks during a shutdown.
Feinstein shared her insights about how a shutdown would “slow things down” for M&A. Under the FTC’s shutdown contingency plan, FTC staff would continue conducting a preliminary review of M&A during the typical 30-day period, but they “can’t engage with [companies]” on any second requests, Feinstein said. “If you have already complied with a second request, usually FTC staff is allowed to engage with you and continue their work,” she added.